Earnings before interest, taxes, depreciation and
amortization before one-time items declined to 423 million euros
($554 million) from 437 million euros a year earlier, the
Amsterdam based company said today. Analysts predicted 413
million euros.

Incoming CEO Ton Buechner, the former Sulzer AG chief,
inherits a broad revamp that spans coatings, paint and specialty
chemicals. Analysts including Laurent Favre of Bank of America
Merrill Lynch have highlighted the looming decision over what to
do with Akzo’s under-performing U.S. decorative paint business
as among the challenges Buechner faces.

“These are fine results, with better than expected price
increases, particularly in Decorative Paints,” ING analyst
Fabian Smeets said by phone. “With the impact from
restructuring measures going forward and Buechner taking the
helm next week I think we can have a nice ride with the share
price in the rest of the year.”

The earnings beat mean Wijers exits his nine-year stint at
the helm on a high, with shares of the company trading 3.5
percent higher at 44.64 euros as of 9:05 a.m. local time. Prior
to today, Akzo had climed 16 percent this year, raising the
market value to 10.2 billion euros.

U.S. Challenge

Wijers’ plan for Akzo outlined annual savings of 450
million euros to help mitigate the effects of higher raw-material costs like titanium dioxide, used as a whitener in
paint. The maker of Dulux-paints has set a target to boost
Ebitda by 500 million euros for 2014 as it improves
manufacturing as well as adding plants in India and Brazil.

Sales in the quarter increased 6 percent to 3.97 billion
euros as cost cutting helped counter weaker volumes in markets
like Europe and North America. Asia and Latin America have
become key drivers of household paint sales. Volumes were down
slightly, reflecting the volatile nature of the economic
conditions, Wijers said.

“I have not given up on the ambition to get U.S. paint to
a break even level in 2012, but this will remain a significant
challenge,” Chief Financial Officer Keith Nichols said on a
conference call.

Volumes in Decorative Paints in North America were down in
the first quarter primarily due to a prior year customer load-in, and operating costs were higher as a consequence of
investments in distribution channels and restructuring measures,
Akzo said today.

Earnings fell 2 percent at Akzo’s specialty chemical
division because of “difficult trading conditions in certain
businesses,” the company said. Rob Frohn, who ran the
specialty-chemicals division following a four-year stint as
Akzo’s chief financial officer, is leaving in the wake of
Buechner’s appointment. A replacement is still being sought.

Buechner will also have to decide if Akzo will take part in
an auction for DuPont Co.’s auto-paint division. The Delaware,
U.S.-based company is exploring the sale of the performance
coatings division, which could fetch as much as $4 billion,
people familiar with the process have said. DuPont will report
earnings later today.